Justice Nagarathna Flags Bias Risk in Arbitration — Courts Won't Remove Ex-Judges, She Says

Supreme Court judge Justice B V Nagarathna has highlighted a key concern in India’s dispute-resolution system, stating that courts are often reluctant to remove arbitrators accused of misconduct when they are former judges or chief justices. She noted that this hesitation reflects a structural gap in ensuring accountability within arbitration proceedings. Her remarks were made at an international conference organised by the Indian Council of Arbitration at the Delhi High Court. The comments have sparked discussion around reforms in alternative dispute resolution mechanisms.

Justice Nagarathna emphasised that arbitration, as part of alternative dispute resolution (ADR), must uphold strict standards of fairness and independence. She cautioned that these mechanisms should not be perceived as a relaxation of judicial discipline or accountability. According to her, maintaining credibility in arbitration is essential for public trust in the system. She pointed out that arbitrators, regardless of their background, must be held to the same standards of integrity. This is especially important as ADR continues to grow in prominence in India.

Addressing the issue of bias, she called for stronger institutional safeguards to deal with complaints against arbitrators. She suggested that existing mechanisms may not be sufficient to handle allegations effectively, particularly when high-profile individuals are involved. The judge stressed the importance of transparency and procedural fairness in resolving such concerns. Without robust systems in place, she warned, the legitimacy of arbitration could be undermined. Her remarks underline the need for structural reforms in the sector.

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Justice Nagarathna also spoke about the Mediation Act 2023, commending its intent while pointing out the lack of substantial implementation so far. She observed that several provisions of the Act have not yet been notified, limiting its effectiveness in strengthening mediation practices across the country. The delay in operationalising the law, she noted, has slowed progress in promoting mediation as a preferred dispute-resolution method. This has implications for reducing the burden on courts. Effective implementation, she suggested, is crucial for achieving its objectives.

Her observations come at a time when India is actively promoting arbitration and mediation as faster alternatives to traditional litigation. Experts believe that addressing concerns around accountability and implementation will be vital for building confidence among stakeholders. The judiciary’s role in shaping these frameworks remains significant, particularly in ensuring fairness and consistency. Justice Nagarathna’s remarks add to the ongoing debate on improving India’s dispute-resolution ecosystem. They also highlight the need for timely policy execution and institutional strengthening.

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